Most consumers prefer new products under familiar brands over new brands

When it comes to product innovation, U.S. shoppers aren’t really looking for companies to reinvent the wheel. In fact, companies are more likely to succeed in a competitive marketplace if they build on established brands consumers already know and trust, according to Nielsen. Reporting results from a recent global study, the New York-based market research firm said 62 percent of U.S. consumers prefer to buy new products from a familiar brand than switch to a new brand.

Although brand familiarity is a key consideration among U.S. shoppers, it’s not deal breaker, Nielsen noted. The company noted that U.S. consumers are open to new products — but value and proof of concept are strong purchase motivators. More than two-thirds (64 percent) of U.S. survey respondents said they would consider value or store brand options, and two thirds will wait until a new innovation has proven itself before making a purchase.

Nielsen added that although U.S. consumers like what they know, 61 percent of them said they like when companies offer a new product, and 57 percent said they’re generally willing to consider purchasing a new product. Successful products also are likely to benefit from strong word-of-mouth advertising, as 54 percent of respondents said they like to tell others about the new items they purchase.

“Consumers are enthusiastic about adopting new product innovations, but they’re somewhat apprehensive about embracing new brands,” said Rob Wengel, senior vice president at Nielsen Innovation Analytics. “In order for consumers to adopt new brands, marketers need to launch strong awareness and trial-building campaigns, supported by a positive product experience. Generating positive word-of-mouth endorsements are important, because negative experiences can significantly diminish the likelihood of new product success.”

For more information, visit www.nielsen.com.

Five steps to capturing the Hispanic market

Some say the Hispanic market may be the last true growth opportunity in food. Most U.S. firms have a major corporate goal to attract Hispanic consumers, given their tremendous demographic and economic importance. Some companies, such as McDonald’s, Budweiser and AT&T, spend significant resources to gain market share with Hispanics and are making inroads. But it’s not easy, says a Nielsen report issued last year.

A Nielsen report from 2012 indicates that “Hispanics are the fastest growing ethnic segment, and are expected to grow 167% from 2010 to 2050, compared to 42% for the total population.” The report also found that Hispanics “will be the dominant and in many cases the only driver of domestic CPG sales growth.” Given their tremendous demographic and economic importance, most U.S.–based firms have a significant corporate imperative to attract Hispanic consumers.

With this new business reality, the Hispanic market may well be one of the last significant growth opportunities left in the U.S., particularly in the consumer goods and service industries.

So, how do you capture this often elusive market? A well-crafted, data-driven strategy is the first step in reaching the Hispanic marketplace. The process must include a marketing, strategy and financial assessments to comprehensively assess the Hispanic opportunity, which results in outputs that frame the size, scope, and process required to win with Hispanics, as well as clear financial contributions and investments.

So remember to : Define clear goals and objectives to win with Hispanics; hyper local strategies are critical; deploy your best people, use world-class analytics and partners; and keep in mind that the Hispanic strategy is a change management imperative.

As Monica Gill, senior vice president, public affairs and government relations at Nielsen, sees it: “Latinos are emerging as a powerhouse of economic influence, presenting marketers an increasingly influential consumer group that can translate into business impact. The key is recognizing that today’s modern Latino is ‘ambicultural,’ with the ability to seamlessly pivot between English and Spanish languages and to embrace two distinct cultures. Understanding how to connect with this unique consumer profile will be key to successful engagement.”

The report puts into perspective that Latinos are no longer just a sub-segment of the economy, “but a prominent player in all aspects of American life.” To that end, what’s needed is a comprehensive approach to creating a Hispanic strategy that highlights a deep understanding of brand building for Hispanics and their critical voice across social media platforms, as well as a “traditional” understanding of the need to approach this group in a highly-targeted and micro-localized fashion, using a test-as-you-go approach to determining best practices.

Source: www.forbes.com

American consumer likes to indulge in Sweets

The American consumer likes to indulge in sweets. While portions might be getting smaller and people may be more health conscious, there is no doubt that a majority of Americans still have a sweet tooth.

According to Nielsen Perishable’s Group’s FreshFacts, for the 52 weeks ending June 29, 2013, Breakfast Bakery volume sales increases are driven by Muffins (+5.7%) and Sweet Goods (+4.7%) while the Dessert category increases are driven by cupcakes (+9.6%), Pies, (+9.1%) and Specialty Desserts (+5.6%).

Global influences, along with an ever expanding taste pallet for American consumers are trends that are evident in the bakery as well.  Specifically, Hispanic Sweet Goods volume sales are up +3.2%, Specialty Dessert Cakes are up +7.8% and Specialty Dessert sales are up +5.6% proving that sweet goods still sell and will continue to do so in the future.

Retailers can take advantage of the US consumer’s desire for sweets by understanding shoppers, innovating to create value beyond price and communicating that value to shoppers.

Pillsbury gives dough a gluten-free makeover

MINNEAPOLIS — News that the Food and Drug Administration has defined “gluten-free” could not have come at a better time for General Mills, Inc., which on Aug. 6 introduced its first-ever line of refrigerated gluten-free dough through its Pillsbury brand. The new offerings include a gluten-free chocolate chip cookie dough, a gluten-free thin crust pizza dough, and gluten-free pie and pastry dough.

“We’re excited to welcome the gluten-free community back to the fresh dough aisle,” said Rebecca Thompson, marketing manager for Pillsbury fresh dough innovation. “Pillsbury gluten-free dough provides so many possibilities and makes enjoying meals together easier. As a company, we are committed to the gluten-free community and to providing great-tasting, easy-to-prepare products from brands they trust.”

The gluten-free products are:

•Pie and pastry dough: 15.8-oz tub, makes two 9-inch pie crusts, 250 calories per serving, suggested retail price of $4.99. 
•Chocolate chip cookie dough: 14.3-oz tub, makes approximately 16 2-inch cookies, 110 calories per serving, s.r.p. of $4.49. 
•Thin crust pizza dough: 13-oz tub, makes one 10-inch pizza crust, 170 calories per serving, s.r.p. of $4.99.

To help kick off the product launch and inspire baking, Pillsbury has partnered with the Iron Chef, cookbook author, television personality and mom Chef Cat Cora. Ms. Cora has created 10 recipes using all three dough varieties. Her gluten-free recipes include snacks and meals for a variety of occasions. The recipes are available atwww.Pillsbury.com/CatCoraGlutenFree.

Pillsbury also has partnered with “Gluten Free Guru” Danna Korn, a bestselling author, and the founder of Raising Our Celiac Kids (R.O.C.K.). She has been an advocate for the celiac community and living a gluten-free lifestyle for more than two decades.

“My passion is to help people learn to live and love the gluten-free lifestyle,” Ms. Korn said. “Going gluten-free is a life-changing experience for most people, and it’s common to feel a loss of convenience and accessibility to great-tasting foods. For Pillsbury to come out with easy-to-make, delicious products that are widely available is a game changer, and I couldn’t be more thrilled.”

Fast food still dominates American diet

While most consumers consider fast food unhealthy, drive-thru fare still dominates the American diet, according to a recent Gallup poll.

Click here for an infographic on fast-food consumption across demographics.

Gallup’s annual Consumption poll, conducted in July, surveyed a random sample of 2,027 adults nationwide.

Eighty per cent reported eating from a fast-food restaurant at least monthly, with almost half indicating at least weekly usage, but more than three-fourths said they think fast food is “not too good” or “not good at all for you.”

Young adults eat fast food most often, with 57% consuming it at least weekly compared with 41% of those aged 65 or older. Men are more likely than women to eat fast food at least weekly, and wealthier consumers reported eating fast food more frequently than the lowest earners. More than half of those with yearly incomes of $75,000 or more said they eat fast food at least weekly, compared with 39% of those earning less than $20,000.

Although most Americans consume fast food at least occasionally, slightly fewer reported eating it at least weekly than they did in 2006, according to Gallup.

Dunkin’ Donuts into London with plans for 50 units

CANTON, MASS. – Dunkin’ Donuts has signed agreements with two franchise groups that call for developing 50 Dunkin’ Donuts restaurants in Greater London over the next five years. The chain also is in discussions with additional franchise partners and possibly may develop a total of 150 restaurants in the United Kingdom over the next five years, Dunkin’ Donuts said Sept. 12.

The Court Group, chaired by U.K. businessman David Sheepshanks, plans to open 25 restaurants in East London. DDMG Ltd., a partnership formed by three U.S. Dunkin’ Donuts franchisees from the Baltimore/Philadelphia area and two U.K. operators, plans to develop 25 restaurants in North London.

“We feel there is a significant opportunity for Dunkin’ Donuts in the U.K., and we have a tremendous response from potential franchisees interested in developing the brand across the country,” said Giorgio Minardi, president of Dunkin’ Brands International. “We are especially delighted to begin the expansion of Dunkin’ Donuts into the U.K. with The Court Group and DDMG Ltd., two experienced franchisees who have a deep passion for the brand and a solid understanding of the local market.”

The U.K. restaurants will feature a range of coffees, teas, espresso-based beverages, Coolatta frozen drinks, donuts, muffins, croissants and sandwiches. The restaurants also will offer regional menu items specific to the United Kingdom and options from a DDSmart line-up.

Dunkin’ Donuts, a business of Canton-based Dunkin’ Brands, Inc., has more than 10,500 restaurants in 31 countries. More than 100 locations in Europe are found in the countries of Bulgaria, Germany, Russia and Spain. Baskin-Robbins, also owned by Dunkin’ Brands, has 100 locations in the United Kingdom. They include free-standing restaurants as well as concession locations in other shops and cinemas.

Supermarket Competing With Restaurants for Prepared Foods

The biggest challenge for many supermarket food operators isn't coming from their own stores’ center aisles or the prepared food departments at competing markets, but rather from nearby restaurants, according to a report from Chicago-based foodservice market research firm Datassential.

The in-depth study, Supermarket Prepared Foods: Evolution Toward a True Foodservice Model,surveyed over 2,000 regular supermarket shoppers and 76 operators to provide a comprehensive analysis of how supermarkets can grow their prepared food departments.

Among the study’s findings:

• Forty percent of operators say that nearby restaurants limit the growth of their prepared foods department
• A majority of shoppers consider supermarket prepared foods to be “excellent” or “good”
• One-third of supermarket customers do not shop the prepared foods department
• Even regular prepared foods shoppers say they often don’t know what’s available
• Supermarkets could grow their deli and bakery business by emulating restaurant marketing tactics
• Shoppers want high quality and a greater variety of healthy, interesting offerings

"Prepared food departments should almost consider themselves to be separate restaurants," said Brian Darr, managing director at Datassential. "They are really competing with Quick Serve Restaurants (QSR) and fast casuals in areas like quality and value. Unlike restaurants, supermarket shoppers don’t have a menu that lets them know what’s available.”

On the operator side, 86 percent want to create a more premium perception with customers, and 83 percent of operators want to improve consumers' overall perception of food quality so that it's on par with restaurants.

In addition to the market challenges, the report also analyzes visitation and traffic, menu offerings, purchasing habits, pricing and promotions, packaging and branding, venue and equipment, and supplier relationships.

"We asked ourselves questions like, 'How do you motivate snack purchases?' and 'What's the one breakfast item every supermarket should offer?'" said Darr. "We really wanted to provide data and intelligence that operators and suppliers could immediately act on."

With over half of their shoppers not buying prepared foods on regular basis, he continued, "Supermarkets have a significant, opportunity to leverage innovative in-store tactics against the fast-growing, high-margin products in the bakery or deli." Further, Darr added, "Supermarkets have some clear actions to take, some as simple as making it easier for shoppers to see what items are available or on special.”

Wal-Mart to expand Sustainability Index 9/13/2013 - by Keith Nunes

BENTONVILLE, Ark. — Wal-Mart Stores Inc. plans to expand its Sustainability Index beyond the United States in 2014, the retailer announced during its Global Sustainability Milestone Meeting on Sept. 12. Wal-Mart Chile and Wal-Mart Mexico will launch the Index in their respective markets in 2014, according to the company. South Africa’s Massmart already has begun to include key Index questions in its supplier sustainability surveys.

“We’ve reached an acceleration point where we are moving from measurement to results,” said Mike Duke, president and CEO. “We’re starting to really drive progress with the Index.”

The Sustainability Index has been rolled out across 200 product categories, and to more than 1,000 suppliers, Wal-Mart said. By the end of this year, it is estimated the Index will expand to include more than 300 product categories and as many as 5,000 suppliers.

Based on data from the Index, Wal-Mart said it has been working with suppliers, nonprofits, industry experts and government to develop and implement solutions that address critical “hot spots” and opportunities across the global supply chain. For example, in an effort to increase the demand for recyclable plastics, the retailer is working to ensure beverage products, dairy creamers and fruit such as berries are packaged using recyclable plastic.

Wal-Mart also is requiring suppliers who use commodity grains, such as corn, wheat and soy as ingredients, to develop a fertilizer optimization plan that outlines goals to improve performance based on Index research. Through the program, the company said it and its suppliers have the potential to reduce fertilizer use on 14 million acres of farmland in the United States by 2020.

Wal-Mart began developing its Sustainability Index in 2009 and in 2011 introduced the program.

Restaurants pose biggest threat to supermarkets’ prepared foods programs

The biggest challenge for many supermarkets’ prepared foods departments isn’t coming from the center store or the prepared foods departments in competing supermarkets. According to a new report from Chicago-based Datassential, it’s coming from nearby restaurants.

“Supermarket Prepared Foods: Evolution Toward a True Foodservice Model” — which details a survey of more than 2,000 regular supermarket shoppers and 76 prepared foods department operators — reports that 40 percent of operators say nearby restaurants limit the growth of their prepared foods department. And while a majority of shoppers consider supermarket prepared foods to be “excellent” or “good,” one-third of supermarket patrons don’t shop the prepared foods department. Even those who regularly shop the prepared foods department say they “often don’t know what’s available.”

Shoppers want high quality and a greater variety of healthful, interesting offerings in this department, the report explains, and supermarkets could grow their deli and bakery business by emulating restaurant marketing tactics.

“Prepared food departments should almost consider themselves to be separate restaurants,” said Brian Darr, managing director, Datassential. “They are really competing with quick-serve restaurants and fast-casuals in areas like quality and value. Unlike restaurants, supermarket shoppers don’t have a menu that lets them know what’s available.”

On the operator side, 86 percent want to create a more premium perception of their prepared foods with customers. Meanwhile, 83 percent want to improve consumers’ overall perception of food quality so that it’s on par with that of restaurants, the report states.

On the consumer side, 37 percent said they would purchase more prepared foods if coupons or discounts were offered, the report says. And 35 percent said they would be motivated to increase purchasing of prepared foods if could choose from a larger variety of products.

In terms of what would get people to try a new prepared food item, half of consumers said they would do so if they were offered a sample of the product, the report points out. At the same time, 31 percent said they would if a trusted person recommended the product, and 27 percent said they would if the product were offered under short-term pricing.

Other tips the report gives on how to increase sales of prepared foods include:

• Highlight in-store chefs and make the relationship personal.
• Offer prepared foods that are time-consuming to make at home, such as roasts, barbecued foods, etc.
• Menu a standard set of items, but offer rotating specials to increase variety.
• Highlight bakery items made in the store with special labels or packaging.
• Create combo meals that include everyday bakery items such as artisan breads and cakes.
• Remind consumers about how prepared foods save time — in terms of both preparation and the clean-up process.

For more information, visit www.datassential.com.

Frozen Yogurt Growth Freezing Out Ice Cream

Although ice cream maintains its leadership in the frozen novelty market with 54 percent of sales in 2013, frozen yogurt is picking up steam, according to new research from Mintel.

Due largely to new product releases spurred by consumer interest in health and the popularity of yogurt offerings in the foodservice arena, frozen yogurt sales saw a 74 percent increase between 2011-2013 -- a monumental increase compared to the 3.9 percent increase of ice cream.

Overall, sales of ice cream and frozen novelties grew 9 percent from 2008-2013 to $11.2 billion, equating to a loss of 1 percent when adjusted for inflation. While ice cream is the most popular segment by far in the sector -- consumed in 89 percent of U.S. households -- the segment posted minimal sales growth, going from $5.7 billion in 2011 to $5.9 billion in 2013. In contrast, the frozen yogurt sector grew from $279 million in 2011 to reach $486 million in 2013.

“While ice cream remains the largest segment of the ice cream and frozen novelties market, sales dipped following the economic downturn,” said Beth Bloom, food and drink analyst at Mintel. “The expanding array of snack options, as well as a lack of product innovation, contributed to this performance.

“In contrast, the frozen yogurt segment has benefitted from a perfect storm of factors,” Bloom continued, “including the growing popularity of yogurt among US consumers, the growing acceptance of frozen yogurt as a snack, and a perception of a higher health profile that coincides with increased attention placed on better-for-you products.”

The majority of consumers (73 percent) believe that ice cream and frozen novelties can fit into a healthy lifestyle, and nearly half (47 percent) agree that low sugar/fat ice cream and frozen treats are as satisfying as regular varieties. However, some 53 percent of consumers say they try to limit the amount of ice cream or frozen treats they keep around the house to avoid excessive consumption, and 21 percent believe eating these items even once a week is too often.

Added Bloom, “Ice cream and frozen novelty products positioned as having an added value through the offer of functional benefits, as well as reduced guilt through their contribution to wellbeing, can stand apart from the competition on store shelves and garner more attention from consumers.”